When Malcolm Turnbull announces his long-awaited urban policy on Friday, only one question will matter: whether he is prepared to invest directly in public transport in our cities.

Turnbull must reverse more than $4bn in cuts to public transport projects around the nation made by the incoming Coalition government in 2013 and announce further public transport investment moving ahead.

The need to address the productivity, sustainability and liveability of our nation’s cities is urgent.

Late last year Infrastructure Australia warned that unless we act now, traffic congestion will cost the nation $53bn in lost productivity a year by 2031. Lower productivity means our economy will produce fewer jobs.

It’s that simple.

When he was campaigning to oust Tony Abbott throughout the first part of 2015, Turnbull sought to show support for public transport by incessantly tweeting pictures of himself riding buses, trains and trams.

But since he took office, Turnbull has failed to invest any new money in public transport.

The infrastructure plan sounds great. But what to build and how to fund it?

There has been no restoration of the funding cuts to critical public transport projects including the Melbourne Metro, Brisbane’s Cross River Rail project, Adelaide’s Tonsley Park and Gawler Line electrification projects or $500m allocated to light and heavy rail in Perth.

At the same time, we have seen a series of leaks on urban policy about the concept of value capture as a means of funding infrastructure.

Value capture is based on the fact that when governments invest in new infrastructure, property values in the vicinity of the project increase and can be taxed to help pay for the project.

A government might, for example, sell the space above a railway station to the developer of a new shopping centre and use the proceeds to help pay for the railway line.

Value capture can be a useful means of assisting governments to meet the burden of delivering infrastructure.

But let’s be clear. Value capture augments government investment; it does not replace it.

If the government is suggesting that existing property owners whose property values are potentially enhanced by new projects should be hit with a new tax, it should come out and say so.

Beware of politicians who tell you they can deliver the world for free, particularly when it comes to building roads and railway lines.

In a recent leak to one newspaper, Turnbull seemed to suggest that he believed that value capture could fund the construction of a high speed rail link between Brisbane and Melbourne via Sydney and Melbourne.

That is absurd unless he proposes a new tax on existing property owners.

Value capture is not a new concept. It has been used around the world for decades.

The former Labor federal government incorporated value capture into plans to build the Melbourne Metro and Brisbane’s Cross River Rail Link – the projects halted by Abbott and Turnbull in 2013.

In March of 2015, I announced with NSW Labor leader Luke Foley support for a Western Sydney rail link through Badgerys Creek Airport to be funded in part through value capture.

It was rejected by the federal Coalition government.

Since then the Labor government in Victoria has produced a new proposal for the Melbourne Metro which also include elements of value capture.

But Turnbull has refused to commit to fund the Metro, instead continuing to quarantine $3 billion to spend on Melbourne’s discredited East West Link – a dud toll road project that would produce only 45 cents public benefit for every dollar invested.

The bottom line is that value capture to fund public transport projects means little unless it is backed up by direct investment.

Labor has already outlined plans to focus on public transport if elected to government later this year.

We’ll invest directly and create a $10 billion infrastructure financing facility to be administered by Infrastructure Australia, which will work with the private sector, to get projects up and running, including through value capture.

Australia has unfortunately wasted three years when it comes to addressing the need for better public transport in cities, which are home to four out of five Australians.